Maple Leaf Foods Reports Second Quarter 2025 Financial Results Français

Cision Canada

07-08-2025

TSX: MFI
Maple Leaf Foods reports Revenue growth of 8.5%, Adjusted EBITDA growth of 28.9%, and increases its fiscal 2025 Adjusted EBITDA outlook
MISSISSAUGA, ON, Aug. 7, 2025 /CNW/ - Maple Leaf Foods Inc. ("Maple Leaf Foods" or the "Company") (TSX: MFI) today reported its financial results for the second quarter ended June 30, 2025.
Second Quarter Highlights
Sales were $1,362 million for the second quarter, compared to $1,255 million for the same period last year, an increase of 8.5%. Sales in the Prepared Foods, Poultry, and Pork operating units (i) increased by 7.5%, 8.5%, and 10.7% respectively.
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA") (ii) grew to $182 million, a 28.9% increase from the second quarter of last year, with Adjusted EBITDA margin increasing from 11.2% to 13.3% for the same period.
Earnings for the second quarter of 2025 were $58 million ($0.47 per basic share) compared to a loss of $26 million ($0.21 per basic share) last year. Adjusted Earnings per Share (ii) for the second quarter of 2025 was $0.56 compared to $0.18 last year.
Net Debt (ii) was $1,344 million, with Net Debt to Trailing Twelve Months Adjusted EBITDA (ii) of 2.1x improving from 2.6x at the end of the first quarter of 2025 and 3.4x at the same time a year ago.
Executive Commentary
"The momentum in our business continued in the second quarter, delivering strong results with sales growth of over 8% and Adjusted EBITDA of $182 million, an increase of $41 million or 29% from the prior year," said Curtis Frank, President and Chief Executive Officer of Maple Leaf Foods. "This performance was fueled by improved profitability in the pork complex and profitable growth in our brand-led consumer packaged goods business, resulting in an Adjusted EBITDA margin of 13.3%, a year-over-year improvement of 210 basis points, and the further strengthening of our balance sheet. With a strong first half now behind us, we are well-positioned to deliver on our increased full-year 2025 Adjusted EBITDA outlook," added Mr. Frank.
"In parallel, we continue to make excellent progress toward completing the spin-off of Canada Packers, supported by resounding shareholder approval and accelerating operational readiness," Frank added. "This historic transaction will unlock significant shareholder value and establish two focused, market-leading companies. We remain firmly on track to complete the transaction in the second half of the year, delivering long-term value for all our stakeholders," concluded Mr. Frank.
Update on the Spin-off of Canada Packers
The Company is continuing to advance its operational readiness for the spin-off of its Pork Operations to create Canada Packers Inc. as a stand-alone public company. The transaction, which was approved by shareholders in June, will be implemented as a tax-free "butterfly reorganization" by way of a plan of arrangement and, subject to receipt of an advance tax ruling from the Canada Revenue Agency and final TSX approval, is on track to be completed in the last half of 2025 as planned.
Outlook
For the full year 2025, the Company expects:
Revenue growth in the mid-single-digit range;
Adjusted EBITDA (ii) in the range of $680 million to $700 million, up from its previous outlook of $634 million or greater;
To maintain an investment-grade balance sheet (iii); and
Capital expenditures in the range of $160 million to $180 million, largely focused on maintenance capital, and adjusted from its previous outlook of $175 million to $200 million due to timing of projects.
(i)
Maple Leaf reorganized its operating units in the first quarter as further defined in the section titled Financial Highlights.
(ii)
Refer to the section titled Non-IFRS Financial Measures in this news release.
(iii)
Maple Leaf defines investment grade leverage as typically operating below 3.0x Net Debt to Trailing Twelve Months Adjusted EBITDA.
The Company currently expects relatively normal pork market conditions and a stable consumer environment to continue for the balance of the year which is reflected in its increased full year 2025 Adjusted EBITDA outlook. However, evolving macro-economic factors continue to influence the operating environment. These factors may have an impact on consumer sentiment, supply chain activity, access to markets, barriers to trade, markets and foreign exchange rates. The Company leverages its data-driven insights to stay close to these evolving circumstances and is confident in the resilience of its brands, business model and strategy to manage through prevailing economic conditions. At the same time, it recognizes that its ability to deliver its 2025 guidance could be impacted by these conditions, including the impact of tariffs between Canada and the U.S. The Company is continuing to closely monitor the evolving tariff landscape so that it is prepared to adapt quickly as circumstances change. It has already adapted to changes in consumer sentiment that have emerged, including launching brand campaigns in Canada that respond to the "buy Canadian" movement.
Financial Highlights
As part of the restructuring of its commercial and supply chain operations during 2024, the Company split its prepared foods operations into two operating units; Prepared Foods which encompasses its prepared meats and plant protein categories, and Poultry which encompasses its fresh poultry category. Maple Leaf Foods consists of three operating units: Prepared Foods, Poultry, and Pork which represent approximately 55%, 20%, and 25% of total Company revenue respectively.
As at or for the
As at or for the
($ millions except earnings per share)
(Unaudited)
three months ended June 30,
six months ended June 30,
2025
2024
Change
2025
2024
Change
Sales (i)
$ 1,362.1
$ 1,255.2
8.5 %
$ 2,603.4
$ 2,402.5
8.4 %
Gross profit
$ 235.7
$ 131.2
79.6 %
$ 453.5
$ 357.5
26.9 %
Selling, general and administrative expenses
$ 113.0
$ 116.6
(3.1) %
$ 227.8
$ 226.7
0.5 %
Earnings (Loss)
$ 57.8
$ (26.2)
nm (iii)
$ 107.3
$ 25.4
nm (iii)
Basic Earnings (Loss) per Share
$ 0.47
$ (0.21)
nm (iii)
$ 0.87
$ 0.21
nm (iii)
Adjusted Operating Earnings (ii)
$ 122.8
$ 78.1
57.2 %
$ 218.5
$ 131.1
66.7 %
Adjusted EBITDA (ii)
$ 181.6
$ 140.9
28.9 %
$ 348.0
$ 257.3
35.3 %
Adjusted EBITDA Margin (ii)
13.3 %
11.2 %
210 bps
13.4 %
10.7 %
270 bps
Adjusted EBT (ii)
$ 94.5
$ 34.4
nm (iii)
$ 169.3
$ 44.8
nm (iii)
Adjusted Earnings per Share (ii)
$ 0.56
$ 0.18
nm (iii)
$ 0.99
$ 0.22
nm (iii)
Free Cash Flow (ii)
$ 216.0
$ 27.0
nm (iii)
$ 202.4
$ 100.7
nm (iii)
Net Debt (ii)
$ 1,344.2
$ 1,723.1
(22.0) %
(i)
Quarterly amounts for 2024 have been adjusted to eliminate new sales agreements entered into during the year that contained an expectation of repurchase, which had previously been reported as external sales.
(ii)
Refer to the section titled Non-IFRS Financial Measures in this news release.
(iii)
Not meaningful.
Sales for the second quarter of 2025 were $1,362.1 million compared to $1,255.2 million last year, an increase of 8.5%. Prepared Foods sales increased by 7.5% driven by pricing, improved mix, and volume growth. Poultry sales increased by 8.5% driven by improved channel mix tied to retail and foodservice volume growth, and pricing. Pork sales increased by 10.7% due to an increase in the number of hogs processed and higher average hog weights.
Year-to-date sales for 2025 were $2,603.4 million, compared to $2,402.5 million last year, an increase of 8.4%. Prepared Foods sales increased by 7.3% driven by pricing, improved mix, volume growth, and favourable foreign exchange impacts related to US sales. Poultry sales increased by 7.3% driven by improved channel mix tied to retail and foodservice volume growth, and pricing. Pork sales increased by 11.3% due to an increase in the number of hogs processed, higher average hog weights, and favourable foreign exchange impacts.
Gross profit for the second quarter of 2025 increased to $235.7 million (gross margin of 17.3%) compared to $131.2 million (gross margin of 10.4%) last year. The increase in gross profit was driven by an increase in mark-to-market valuation of biological assets and commodity futures contracts, improved pork market conditions, favourable volume and mix impacts in Prepared Foods and Poultry, and operating efficiencies inclusive of benefits from the investments in the London poultry and Bacon Centre of Excellence facilities. These factors were partially offset by increased trade promotions.
Year-to-date gross profit for 2025 was $453.5 million (gross margin of 17.4%) compared to $357.5 million (gross margin of 14.9%) last year. The increase in gross profit was driven by improved pork market conditions, favourable volume and mix impacts in Prepared Foods and Poultry, and lower start-up expenses. These factors were partially offset by increased trade promotions and a decrease in mark-to-market valuation of biological assets.
Selling, General and Administrative ("SG&A") expenses for the second quarter of 2025 were $113.0 million compared to $116.6 million last year. The decrease in SG&A expenses was primarily driven by lower consulting fees, which were partially offset by higher variable compensation.
Year-to-date SG&A expenses for 2025 were $227.8 million compared to $226.7 million last year. The increase in SG&A expenses was driven by higher variable compensation and higher advertising and promotional expenses, which were partially offset by lower consulting fees.
Earnings for the second quarter of 2025 were $57.8 million ($0.47 basic earnings per share) compared to a loss of $26.2 million ($0.21 basic loss per share) last year. Earnings were impacted by the same factors as noted above for gross profit and SG&A as well as reduced interest expense due to lower debt, all partly offset by higher income tax expense as well as incremental costs associated with the upcoming spin-off of the Pork Operations and certain costs associated with the "Fuel for Growth" initiative, both of which were recorded outside of Adjusted Operating Earnings.
Year-to-date earnings for 2025 were $107.3 million ($0.87 basic earnings per share) compared to $25.4 million ($0.21 basic earnings per share) last year. Year-to-date earnings were impacted by the same factors as noted above for gross profit and SG&A, as well as reduced interest expense due to lower debt, all partly offset income tax expenses and by incremental costs associated with the upcoming spin-off of the Pork Operations and the "Fuel for Growth" initiative, both of which were recorded outside of Adjusted Operating Earnings.
Adjusted Operating Earnings for the second quarter of 2025 were $122.8 million compared to $78.1 million last year, and Adjusted Earnings per Share for the second quarter of 2025 was $0.56 compared to $0.18 last year. The increase was driven by factors consistent with those noted above for gross profit and SG&A expenses, excluding the impact of unrealized mark-to-market valuation adjustments.
Year-to-date Adjusted Operating Earnings for 2025 were $218.5 million compared to $131.1 million last year, and Adjusted Earnings per Share for 2025 was $0.99 compared to $0.22 last year due to factors consistent with those noted above for gross profit and SG&A expenses excluding the impact of unrealized mark-to-market valuation adjustments and start-up expenses.
Adjusted EBITDA for the second quarter was $181.6 million, compared to $140.9 million last year, driven by factors consistent with those noted above for Adjusted Operating Earnings. Adjusted EBITDA Margin was 13.3% compared to 11.2% last year, also driven by factors consistent with those noted above.
Year-to-date Adjusted EBITDA for 2025 was $348.0 million compared to $257.3 million last year, driven by factors consistent with those noted above for Adjusted Operating Earnings along with reduction of other expense. Year-to-date Adjusted EBITDA Margin for 2025 was 13.4% compared to 10.7% last year, also driven by factors consistent with those noted above.
Adjusted Earnings Before Taxes ("Adjusted EBT") for the second quarter of 2025 were $94.5 million compared to $34.4 million last year due to similar factors as noted above for Adjusted EBITDA, along with a reduction in interest expense.
Year-to-date Adjusted EBT for 2025 were $169.3 million compared to $44.8 million last year due to similar factors as noted above for the second quarter.
Free Cash Flow for the second quarter of 2025 was $216.0 million compared to Free Cash Flow of $27.0 million in the prior year. The improvement was driven by improved earnings after the removal of non-cash items, and timing impacts related to the change in non-cash working capital.
Year-to-date Free Cash Flow for 2025 was $202.4 million compared to Free Cash Flow of $100.7 million in the prior year. Free Cash Flow increased significantly due to improved earnings after the removal of non-cash items, timing impacts related to the change in non-cash working capital, and lower interest payments.
Net Debt as at June 30, 2025 was $1,344.2 million, a decrease of $378.8 million compared to the prior year.
Note: Several items are excluded from the discussions of underlying earnings performance as they are not representative of ongoing operational activities. Refer to the section entitled Non-IFRS Financial Measures at the end of this news release for a description and reconciliation of all non-IFRS financial measures.
Other Matters
On August 6, 2025, the Board of Directors approved a quarterly dividend of $0.24 per share, $0.96 per share on an annual basis, payable September 29, 2025, to shareholders of record at the close of business on September 5, 2025. Unless indicated otherwise by the Company at or before the time the dividend is paid, the dividend will be considered an eligible dividend for the purposes of the "Enhanced Dividend Tax Credit System". The Company's Dividend Reinvestment Plan ("DRIP") permits eligible shareholders to direct their cash dividends to be reinvested in additional common shares of the Company. The Company eliminated the 2% discount on the treasury shares issued under the DRIP beginning in 2025. Therefore, for shareholders who wish to reinvest their dividends under the DRIP, Maple Leaf Foods intends to issue common shares from treasury at a price equal to 100% of the weighted average closing price of the shares for the five trading days preceding the dividend payment date. Full details of the DRIP, including how to enroll in the program, are available at https://www.mapleleaffoods.com/.
Conference Call
A conference call will be held at 8:30 a.m. ET on August 7, 2025, to review Maple Leaf Foods' second quarter financial results. To participate in the call, please dial 416-945-7677 or 1-888-699-1199. For those unable to participate, playback will be made available an hour after the event at 289-819-1450 or 1-888-660-6345 (Passcode: 00409#).
A webcast of the second quarter conference call will also be available at: https://www.mapleleaffoods.com/investors/events-and-presentations/.
The Company's full unaudited condensed consolidated interim financial statements ("Consolidated Interim Financial Statements") and related Management's Discussion and Analysis are available on the Company's website and on SEDAR+ at www.sedarplus.ca.
An investor presentation related to the Company's second quarter financial results is available at www.mapleleaffoods.com under Presentations and Webcasts on the Investors page.
Non-IFRS Financial Measures
The Company uses the following non-IFRS measures: Adjusted Operating Earnings, Adjusted Earnings per Share, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted EBT, Construction Capital, Net Debt, Net Debt to Trailing Twelve Months Adjusted EBITDA, Free Cash Flow and Return on Net Assets. Management believes that these non-IFRS measures provide useful information to investors in measuring the financial performance of the Company for the reasons outlined below. These measures do not have a standardized meaning prescribed by IFRS and therefore they may not be comparable to similarly titled measures presented by other publicly traded companies and should not be construed as an alternative to other financial measures determined in accordance with IFRS.
Adjusted Operating Earnings, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted EBT
Adjusted Operating Earnings, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted EBT are non-IFRS measures used by Management to evaluate financial operating results. Adjusted Operating Earnings is defined as earnings before income taxes adjusted for items that are not considered representative of ongoing operational activities of the business and certain items where the economic impact of the transactions will be reflected in earnings in future periods when the underlying asset is sold or transferred. Adjusted EBITDA is defined as Adjusted Operating Earnings plus depreciation and intangible asset amortization, adjusted for items included in other expense that are considered representative of ongoing operational activities of the business. Adjusted EBITDA Margin is calculated as Adjusted EBITDA divided by sales. Adjusted EBT is used annually by the Company to evaluate its performance and is a component of calculating bonus entitlements under the Company's short term incentive plan. It is defined as Adjusted EBITDA plus interest income, less depreciation and amortization, and interest expense and other financing costs.
The table below provides a reconciliation of earnings before income taxes as reported under IFRS in the Consolidated Interim Financial Statements to Adjusted Operating Earnings, Adjusted EBITDA and Adjusted EBT for the three and six months ended June 30, 2025 as indicated below. Management believes that these non-IFRS measures are useful in assessing the performance of the Company's ongoing operations and its ability to generate cash flows to fund its requirements.
Three months ended June 30,
Six months ended June 30,
($ millions) (i)
(Unaudited)
2025
2024
2025
2024
Earnings (loss) before income taxes
$ 81.0
$ (32.5)
$ 151.6
$ 41.3
Interest expense and other financing costs
26.2
43.6
55.9
85.7
Other expense (income)
12.8
(3.5)
14.0
(2.3)
Restructuring and other related costs
2.7
6.9
4.2
6.2
Earnings from operations
$ 122.8
$ 14.5
$ 225.7
$ 130.8
Start-up expenses from Construction Capital (ii)
0.8
4.4
2.2
15.8
Decrease (increase) in fair value of biological assets
8.1
52.5
(8.3)
(16.7)
Decrease (increase) in derivative contracts
(8.9)
6.8
(1.0)
1.1
Adjusted Operating Earnings
$ 122.8
$ 78.1
$ 218.5
$ 131.1
Depreciation and amortization (iii)
61.5
63.7
124.1
128.6
Items included in other income (expense) representative of
ongoing operations (iv)
(2.7)
(0.9)
5.3
(2.4)
Adjusted EBITDA
$ 181.6
$ 140.9
$ 348.0
$ 257.3
Adjusted EBITDA Margin (v)
13.3 %
11.2 %
13.4 %
10.7 %
Interest expense and other financing costs
(26.2)
(43.6)
(55.9)
(85.7)
Interest income
0.6
0.8
1.3
1.8
Depreciation and amortization
(61.5)
(63.7)
(124.1)
(128.6)
Adjusted EBT
$ 94.5
$ 34.4
$ 169.3
$ 44.8
(i)
Totals may not add due to rounding.
(ii)
Start-up expenses are temporary costs as a result of operating new facilities that are or were previously classified as Construction Capital. These costs can include training, product testing, yield and labour efficiency variances, duplicative overheads including depreciation and other temporary expenses required to ramp-up production.
(iii)
Depreciation included in start-up expenses is excluded from this line.
(iv)
Primarily includes certain costs associated with sustainability projects, gains and losses on the impairment and sale of long-term assets, gains and losses on investments and other miscellaneous expenses.
(v)
Quarterly amounts for 2024 have been adjusted to eliminate new sales agreements entered into during the year that contained an expectation of repurchase, which had previously been reported as external sales.
Adjusted Earnings per Share
Adjusted Earnings per Share, a non-IFRS measure, is used by Management to evaluate financial operating results. It is defined as basic earnings per share and is adjusted on the same basis as Adjusted Operating Earnings. The table below provides a reconciliation of basic earnings per share as reported under IFRS in the Consolidated Interim Financial Statements to Adjusted Earnings per Share for the three and six months ended June 30 as indicated below. Management believes this basis is the most appropriate on which to evaluate financial results as they are representative of the ongoing operations of the Company.
($ per share)
(Unaudited)
Three months ended June 30,
Six months ended June 30,
2025
2024
2025
2024
Basic earnings (loss) per share
$ 0.47
$ (0.21)
$ 0.87
$ 0.21
Restructuring and other related costs (i)
0.02
0.04
0.03
0.04
Items included in other expense not considered
representative of ongoing operations (ii)
0.07
(0.03)
0.14
(0.02)
Start-up expenses from Construction Capital (iii)
0.01
0.03
0.01
0.10
Change in fair value of biological assets
0.05
0.31
(0.05)
(0.12)
Change in unrealized and deferred fair value on derivatives
(0.05)
0.04
(0.01)
0.01
Adjusted Earnings per Share (iv)
$ 0.56
$ 0.18
$ 0.99
$ 0.22
(i)
Includes per share impact of restructuring and other related costs, net of tax.
(ii)
Primarily includes legal fees, vacancy costs on investment property, transaction related costs and costs associated with "Fuel for Growth", net of tax.
(iii)
Start-up expenses are temporary costs as a result of operating new facilities that are or were previously classified as Construction Capital. These costs can include training, product testing, yield and labour efficiency variances, duplicative overheads and other temporary expenses required to ramp-up production, net of tax.
(iv)
Totals may not add due to rounding.
Construction Capital
Construction Capital, a non-IFRS measure, is used by Management to evaluate the amount of capital resources invested in specific strategic development projects that are not yet operational. It is defined as investments and related financing charges in projects over $50 million that are related to longer-term strategic initiatives, with no returns expected for at least 12 months from commencement of construction and the asset is re-categorized from Construction Capital once operational. There were no Construction Capital projects during the three and six months ended June 30, 2025 or June 30, 2024 as all projects had been completed and recategorized as regular property and equipment.
Net Debt
The following table reconciles Net Debt and Net Debt to Trailing Twelve Months Adjusted EBITDA ratio to amounts reported under IFRS in the Company's Consolidated Interim Financial Statements as at June 30 as indicated below. The Company calculates Net Debt as cash and cash equivalents, less current and long-term debt and bank indebtedness and calculates Net Debt to Trailing Twelve Months Adjusted EBITDA as the absolute value of Net Debt divided by Trailing Twelve Months Adjusted EBITDA. Management believes this measure is useful in assessing the amount of financial leverage employed.
(i)
Trailing Twelve Months includes Q3 2024, Q4 2024, Q1 2025, and Q2 2025 for 2025; and Q3 2023, Q4 2023, Q1 2024, and Q2 2024 for 2024.
Free Cash Flow
Free Cash Flow, a non-IFRS measure, is used by Management to evaluate cash flow after investing in the maintenance of the Company's asset base. It is defined as cash provided by operations, less Maintenance Capital (i) and associated interest paid and capitalized. The following table calculates Free Cash Flow for the periods indicated below:
($ thousands)
(Unaudited)
Three months ended June 30,
Six months ended June 30,
2025
2024
2025
2024
Cash provided by operating activities
$ 239,587
$ 45,496
$ 249,470
$ 132,821
Maintenance Capital (i)
(23,276)
(18,250)
(46,516)
(31,686)
Interest paid and capitalized related to
Maintenance Capital
(285)
(220)
(555)
(483)
Free Cash Flow
$ 216,026
$ 27,026
$ 202,399
$ 100,652
(i)
Maintenance Capital is defined as non-discretionary investment required to maintain the Company's existing operations and competitive position. For the three and six months ended June 30, 2025, total capital spending of $24.4 million and $49.3 million (2024: $16.3 million and $40.1 million) shown on the Consolidated Interim Statements of Cash Flows is made up of Maintenance Capital of $23.3 million and $46.5 million (2024: $18.3 million and $31.7 million), and Growth Capital of $1.1 million for the three months ended June 30, 2025 and $2.8 million for the six months ended June 30, 2025 (2024: net inflow of $2.0 million as a result of government grants received and a net outflow of $8.4 million). Growth Capital is defined as discretionary investment meant to create stakeholder value through initiatives that for example, expand margins, increase capacities or create further competitive advantage.
Return on Net Assets ("RONA")
RONA is calculated by dividing tax effected earnings from operations (adjusted for items which are not considered representative of the underlying operations of the business) by average monthly net assets. Net assets are defined as total assets (excluding cash and deferred tax assets) less non-interest bearing liabilities (excluding deferred tax liabilities). Management believes that RONA is an appropriate basis upon which to evaluate long-term financial performance.
Forward-Looking Statements
This document contains, and the Company's oral and written public communications often contain, "forward-looking information" within the meaning of applicable securities law. These statements are based on current expectations, estimates, projections, beliefs, judgements and assumptions based on information available at the time the applicable forward-looking statement was made and in light of the Company's experience combined with its perception of historical trends. Such statements include, but are not limited to, statements with respect to objectives and goals, in addition to statements with respect to beliefs, plans, targets, goals, objectives, expectations, anticipations, estimates, and intentions. Forward-looking statements are typically identified by words such as "anticipate", "continue", "estimate", "expect", "may", "will", "project", "should", "could", "would", "believe", "plan", "intend", "design", "target", "undertake", "view", "indicate", "maintain", "explore", "entail", "schedule", "objective", "strategy", "likely", "potential", "outlook", "aim", "propose", "goal", and similar expressions suggesting future events or future performance. These statements are not guarantees of future performance and involve assumptions, risks and uncertainties that are difficult to predict.
By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. The Company believes the expectations reflected in the forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon.
Specific forward-looking information in this document may include, but is not limited to, statements with respect to:
the terms, timing, receipt of all approvals, expected structure, expected benefits, risks, costs, dis-synergies and tax implications associated with the spin-off including the timely receipt of an advance tax ruling from the CRA in form and substance satisfactory to the Company;
the anticipated future financial performance of the businesses following the spin-off, including post separation business structure, the operationalization of the proposed agreements entered into between the companies, and the ability of each company to execute their respective business and sustainability strategies;
assumptions about the economic environment, including the implications of tariffs, inflationary pressures on customer and consumer behaviour, supply chains, global conflicts and competitive dynamics;
expected future cash flows and the sufficiency thereof, sources of capital at attractive rates, future contractual obligations, future financing options, renewal of credit facilities, compliance with credit facility covenants, and availability of capital to fund growth plans, operating obligations and dividends;
future performance, including future financial objectives, goals and targets, category growth analysis, expected capital spend and expected SG&A expenditures, global pork market dynamics, Japan export market margin outlook, labour markets, and inflationary pressures (including the ability to price for inflation);
potential for a recurrence of a cybersecurity incident on the Company's systems, business and operations, as well as the ability to mitigate the financial and operational impacts, the success of remediation and recovery efforts, the implications of data breaches, and other ongoing risks associated with cybersecurity;
the execution of the Company's business strategy, including the development and expected timing of business initiatives, brand expansion and repositioning, plant protein category investment and performance, market access in China and Japan, capital allocation decisions (including investment in share repurchases under a NCIB) and investment in potential growth opportunities and the expected returns associated therewith;
the impact of international trade conditions, tariffs and markets on the Company's business, including access to markets, global conflict and other social, economic and political factors that affect trade;
implications associated with the spread of foreign animal disease (such as African Swine Fever ("ASF")) and other animal diseases such as Avian Influenza;
competitive conditions and the Company's ability to position itself competitively in the markets in which it competes;
capital projects, including planning, construction, estimated expenditures, schedules, approvals, and anticipated benefits;
the Company's dividend policy, including future levels and sustainability of cash dividends, the tax treatment thereof and future dividend payment dates;
the impact of commodity prices and foreign exchange impacts on the Company's operations and financial performance, including the use and effectiveness of hedging instruments;
operating risks, including the execution, monitoring and continuous improvement of the Company's food safety programs, animal health initiatives, cost reduction initiatives, and service levels (including service level penalties);
the implementation, cost and impact of environmental sustainability initiatives, the ability of the Company to achieve its sustainability objectives, changing climate and sustainability laws and regulation, changes in customer and consumer expectations related to sustainability matters, as well as the anticipated future cost of remediating environmental liabilities;
the adoption of new accounting standards and the impact of such adoption on the financial position of the Company;
expectations regarding pension plan performance, including future pension plan assets, liabilities and contributions; and
developments and implications of actual or potential legal actions.
Various factors or assumptions are typically applied by the Company in drawing conclusions or making the forecasts, projections, predictions or estimations set out in the forward-looking statements. These factors and assumptions are based on information currently available to the Company, including information obtained by the Company from third-party sources and include but are not limited to the following:
expectations and assumptions concerning the timing and completion of the spin-off; implications of the risks, benefits, costs, dis-synergies, tax structure, future business performance of each company; the impact of the operationalization of the agreements between the companies; and ability of each company to execute their respective business and sustainability strategies to generate returns;
expectations and assumptions as to the timely receipt of an advance tax ruling from the CRA in form and substance satisfactory to the Company which is not altered or withdrawn; satisfaction of the conditions necessary to proceed with tax matters agreement; compliance by Maple Leaf Foods, Canada Packers and "specified shareholders", as defined in the Income Tax Act ("ITA"), with the rules related to butterfly transactions under the ITA both before and after the completion of the spin-off;
expectations regarding the adaptations in operations, supply chain, customer and consumer behaviour, economic patterns (including but not limited to global pork markets), foreign exchange rates, tariffs and other international trade dynamics, access to capital, and potential structural changes in global economic patterns;
the competitive environment, associated market conditions (including tariffs) and market share metrics, category growth or contraction, the expected behaviour of competitors and customers and trends in consumer preferences;
the success of the Company's business strategy and the relationship between pricing, inflation, volume and sales of the Company's products;
prevailing commodity prices (especially in pork and feed markets), implications of tariffs, interest rates, tax rates and exchange rates;
potential impacts related to cybersecurity matters, including security costs, the potential for a future incident, the risks associated with data breaches, the availability of insurance, the effectiveness of remediation and prevention activities, third party activities, ongoing impacts, customer, consumer and supplier responses and regulatory considerations;
the economic condition of and the sociopolitical dynamics between Canada, the U.S., Japan and China, and the ability of the Company to access markets and source ingredients and other inputs in light of global sociopolitical disruption, and the ongoing impact of global conflicts on inflation, trade and markets;
the spread of foreign animal disease (including ASF and Avian Influenza), preparedness strategies to manage such spread, and implications for all protein markets;
the availability of and access to capital to fund future capital requirements and ongoing operations;
expectations regarding participation in and funding of the Company's pension plans;
the availability of insurance coverage to manage certain liability exposures;
the extent of future liabilities and recoveries related to legal claims;
prevailing regulatory, tax and environmental laws; and
future operating costs and performance, including the Company's ability to achieve operating efficiencies and maintain sales volumes, turnover of inventories and turnover of accounts receivable.
Readers are cautioned that these assumptions may prove to be incorrect in whole or in part. The Company's actual results may differ materially from those anticipated in any forward-looking statements.
Factors that could cause actual results or outcomes to differ materially from the results expressed, implied, or projected in the forward-looking statements contained in this document include, among other things, risks associated with the following:
the spin-off not proceeding as expected (within the expected timeline or at all), including as a result of the conditions of the transaction, including receipt of all third-party consents and approvals, not being satisfied;
the spin-off not delivering the intended benefits, including the ability of the separated companies to each succeed as a standalone publicly trading company;
unanticipated effects of the announcement of the spin-off, and/or changes in transaction structure, on the market price for the Company's securities or the financial performance of the Company;
the results of each of the separated companies' execution of their respective business plans, the degree to which benefits are realized or not and the timing to realize those benefits, including the implications on the financial results of each;
failure to satisfy the conditions contained in the tax matters agreement as described in the Management Information Circular dated May 1, 2025;
failure to receive an advance tax ruling from the CRA on terms acceptable to the Company in form and substance satisfactory to the Company, that is not altered or withdrawn;
failure of the Company, Canada Packers or a "specified shareholder," as defined in the ITA, to comply with the rules related to butterfly transactions under the ITA which could result in significant tax becoming payable by the Company and/or Canada Packers;
potential structural changes in global economic patterns which may have implications for the operations and financial performance of the Company, as well the ongoing implications for macro socio-economic trends, trade action and global conflict;
macro economic trends, including inflation, consumer behaviour, recessionary indicators, labour availability and labour market dynamics and international trade trends, including tariffs, duties and global pork markets;
the results of the Company's execution of its business plans, the degree to which benefits are realized or not, and the timing associated with realizing those benefits, including the implications on cash flow;
competition, market conditions, and the activities of competitors and customers, including the expansion or contraction of key categories, inflationary pressures, pork market dynamics and Japan export margins;
cybersecurity and maintenance and operation of the Company's information systems, processes and data, recovery, restoration and long term impacts of the cybersecurity event, the risk of future cybersecurity events, actions of third parties, risks of data breaches, effectiveness of business continuity planning and execution, and availability of insurance;
the health status of livestock, including the impact of potential pandemics;
international trade and access to markets and supplies, as well as social, political and economic dynamics, including global conflicts;
operating performance, including manufacturing operating levels, fill rates and penalties;
availability of and access to capital, and compliance with credit facility covenants;
decisions respecting the return of capital to shareholders;
the execution of capital projects and investment in maintenance capital;
food safety, consumer liability and product recalls;
climate change, climate regulation and the Company's sustainability performance;
strategic risk management;
acquisitions and divestitures;
fluctuations in the debt and equity markets;
fluctuations in interest rates and currency exchange rates;
pension assets and liabilities;
cyclical nature of the cost and supply of hogs and the competitive nature of the pork market generally;
the effectiveness of commodity and interest rate hedging strategies;
impact of changes in the market value of the biological assets and hedging instruments;
the supply management system for poultry in Canada;
availability of plant protein ingredients;
intellectual property, including product innovation, product development, brand strategy and trademark protection;
consolidation of operations and focus on protein;
the use of contract manufacturers;
reputation;
weather;
compliance with government regulation and adapting to changes in laws;
actual and threatened legal claims;
consumer trends and changes in consumer tastes and buying patterns;
environmental regulation and potential environmental liabilities;
consolidation in the retail environment;
employment matters, including complying with employment laws across multiple jurisdictions, the potential for work stoppages due to non-renewal of collective agreements, recruiting and retaining qualified personnel, reliance on key personnel and succession planning;
pricing of products;
managing the Company's supply chain;
changes in International Financial Reporting Standards and other accounting standards that the Company is required to adhere to for regulatory purposes; and
other factors as set out under the heading "Risk Factors" in the Company's Management Discussion and Analysis for the year ended December 31, 2024.
The Company cautions readers that the foregoing list of factors is not exhaustive.
Readers are further cautioned that some of the forward-looking information, such as statements concerning future capital expenditures, Adjusted EBITDA expectations, Adjusted EBITDA Margin expansion, and the Company's ability to achieve its financial targets or projections may be considered to be financial outlooks for purposes of applicable securities legislation. These financial outlooks are presented to evaluate potential future earnings and anticipated future uses of cash flows and may not be appropriate for other purposes. Readers should not assume these financial outlooks will be achieved.
More information about risk factors can be found under the heading "Risk Factors" in the Company's Annual Management's Discussion and Analysis for the year ended December 31, 2024, that is available on SEDAR+ at www.sedarplus.ca. The reader should review such section in detail. Additional information concerning the Company, including the Company's Annual Information Form, is available on SEDAR+ at www.sedarplus.ca.
All forward-looking statements included herein speak only as of the date hereof. Unless required by law, the Company does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. All forward-looking statements contained herein are expressly qualified by this cautionary statement.
Management's Estimates on the Pork Operations spin-off, and related Non-IFRS measures
The following tables present Management's preliminary estimates of certain financial information regarding Canada Packers and the business that will be retained after the separation by Maple Leaf Foods. These preliminary estimates have not been audited or reviewed by any third party, have been derived from internal management reporting, and reflect sales, cost and expense allocations, including with respect to corporate expenses, as well as other estimates and adjustments, each of which is preliminary in nature and subject to change.
Management believes that these preliminary estimates are useful in providing an indication of the relative size of the businesses upon separation. These preliminary estimates continue to be refined as the Company works to finalize the separation.
Notes
(i)
Refers to the business that will be retained after the separation by Maple Leaf Foods Inc.
(ii)
Represents management's preliminary estimate of sales (both to Maple Leaf Foods and to external third parties) attributable to the business that will be transferred to Canada Packers in the separation for the period presented.
(iii)
Represents management's preliminary estimate of sales attributable to the business that will be retained by Maple Leaf Foods after the separation for the period presented.
(iv)
Primarily represents management's preliminary estimate of sales from Canada Packers to Maple Leaf Foods for the period presented.
(v)
See the Company's Q2 2025 Consolidated Interim Financial Statements filed on SEDAR+
(vi)
Represents management's preliminary estimate of the potential impact on Sales of Canada Packers and Maple Leaf Foods (as defined in note (i) above), respectively, if the separation had occurred on April 1, 2025. Primarily relates to management's preliminary estimate of the change in sales as a result of the anticipated impact of the supply agreement and other contractual arrangements expected to be entered into in connection with the separation.
(vii)
Represents management's preliminary estimate of the portion of consolidated Adjusted EBITDA attributable to Canada Packers for the period presented. As noted above, this estimate is subject to change as the Company works to finalize the separation.
(viii)
Represents management's preliminary estimate of the portion of consolidated Adjusted EBITDA attributable to Maple Leaf Foods (as defined in note (i) above) for the period presented. As noted above, this estimate is subject to change as the Company works to finalize the separation.
(ix)
For a definition of Adjusted EBITDA (consolidated), and a reconciliation of Adjusted EBITDA (consolidated) for the periods described in note (v) above to consolidated net income for such periods, see the Company's MD&A filed on SEDAR+ for the quarter ended June 30, 2025.
*
Defined as Adjusted EBITDA divided by Sales. This metric is subject to change as the Company works to finalize the separation in the same manner as the metrics from which this metric is derived, as noted above.
(xi)
Represents management's preliminary estimate of the potential impact on Adjusted EBITDA of Canada Packers and Maple Leaf Foods (as defined in note (i) above), respectively, if the separation had occurred on April 1, 2025. Primarily relates to management's preliminary estimate of (1) a change in Adjusted EBITDA of Canada Packers and an offsetting change in Adjusted EBITDA of Maple Leaf Foods as a result of the anticipated impact of the supply agreement and other contractual arrangements expected to be entered into in connection with the separation, (2) public company costs that would have been incurred by Canada Packers, and (3) a reallocation of certain SG&A expenses between Canada Packers and Maple Leaf Foods. As noted above, this estimate is subject to change and is expected to be refined prior to the separation.
(xii)
Defined as Adjusted EBITDA plus management's preliminary estimate of the potential impact of the separation described in, and subject to the qualifications described in, note (xi) above.
(xiii)
Defined as Pro Forma Adjusted EBITDA, as described in note (xii) above divided by Pro Forma Sales. This metric is subject to change as the Company works to finalize the separation in the same manner as the metrics from which this metric is derived, as noted above.
(xiv)
Presented for illustrative purposes only, based on management estimates and assumptions, to indicate what the potential impact on Pro Forma Adjusted EBITDA may have been if market conditions during the period presented had reflected normal market conditions, defined as the 5-year pre-pandemic (2015 – 2019) average ("Normal Market Conditions"). Actual market conditions during the period presented were materially different from Normal Market Conditions, and there can be no assurance that actual Pro Forma Adjusted EBITDA would have been impacted in the manner shown if Normal Market Conditions had existed during the period presented, or that actual future market conditions will reflect Normal Market Conditions. This metric is not intended to be indicative of potential financial results for any future period.
(xv)
Defined as Pro Forma Adjusted EBITDA, as described in note (xi) above, plus management's preliminary estimate of the potential impact if market conditions during the period presented had reflected Normal Market Conditions, subject to the qualifications described in note (xiv) above. This metric is presented for illustrative purposes only and is not intended to be indicative of potential financial results for any future period.
(xvi)
Defined as Pro Forma normalized Adjusted EBITDA, as described in note (xiv) above, divided by Pro Forma Sales. This metric is presented for illustrative purposes only and is based on management estimates and assumptions. This metric is subject to change and is expected to be refined prior to the separation in the same manner as the metrics from which this metric is derived, as noted above. Actual market conditions during the period presented were materially different from Normal Market Conditions, and there can be no assurance that actual Pro Forma Adjusted EBITDA Margin would have been impacted in the manner shown if Normal Market Conditions had existed during the period presented, or that actual future market conditions will reflect Normal Market Conditions. This metric is not intended to be indicative of potential financial results for any future period.
Last twelve months ended June 30, 2025
(in millions of Canadian dollars)
(unaudited)
Canada
Packers
Maple Leaf
Foods (i)
Eliminations
Consolidated
Maple Leaf
Foods Inc.
Sales (IFRS)
$ 1,769
(ii)
$ 3,751
(iii)
$ (424)
(iv)
$ 5,096
(v)
Estimate of potential impact of separation (vi)
(77)
71
Pro Forma Sales
$ 1,692
$ 3,822
Adjusted EBITDA
$ 192
(vii)
$ 452
(viii)
—
$ 644
(v),(ix)
Adjusted EBITDA Margin *
10.9 %
12.1 %
— %
12.6 %
Estimate of potential impact of separation (xi)
~$(21)
~11
Pro Forma Adjusted EBITDA (xii)
~$170
~$463
Pro Forma Adjusted EBITDA margin (xiii)
~10%
~12%
Estimate of potential market
normalization impact (xiv)
~$30 - 40
Pro Forma normalized Adjusted EBITDA (xv)
~$200
Pro Forma normalized Adjusted
EBITDA Margin (xvi)
~12%
Notes
(i)
Refers to the business that will be retained after the separation by Maple Leaf Foods Inc.
(ii)
Represents management's preliminary estimate of sales (both to Maple Leaf Foods and to external third parties) attributable to the business that will be transferred to Canada Packers in the separation for the period presented.
(iii)
Represents management's preliminary estimate of sales attributable to the business that will be retained by Maple Leaf Foods after the separation for the period presented.
(iv)
Primarily represents management's preliminary estimate of sales from Canada Packers to Maple Leaf Foods for the period presented.
(v)
Calculated by adding the previously reported results for the year ended December 31, 2024 to results for the six months ended June 30, 2025 and subtracting results for the six months ended June 30, 2024. These results are reported in the Company's MD&A filed on SEDAR and SEDAR+ for the year ended December 31, 2024, the quarter ended June 30, 2025 and the quarter ended June 30, 2024.
(vi)
Represents management's preliminary estimate of the potential impact on Sales of Canada Packers and Maple Leaf Foods (as defined in note (i) above), respectively, if the separation had occurred on June 30, 2024. Primarily relates to management's preliminary estimate of the change in sales as a result of the anticipated impact of the supply agreement and other contractual arrangements expected to be entered into in connection with the separation.
(vii)
Represents management's preliminary estimate of the portion of consolidated Adjusted EBITDA attributable to Canada Packers for the period presented. As noted above, this estimate is subject to change as the Company works to finalize the separation.
(viii)
Represents management's preliminary estimate of the portion of consolidated Adjusted EBITDA attributable to Maple Leaf Foods (as defined in note (i) above) for the period presented. As noted above, this estimate is subject to change as the Company works to finalize the separation.
(ix)
For a definition of Adjusted EBITDA (consolidated), and a reconciliation of Adjusted EBITDA (consolidated) for the periods described in note (v) above to consolidated net income for such periods, see the Company's MD&A filed on SEDAR and SEDAR+ for the year ended December 31, 2024, the quarter ended June 30, 2025 and the quarter ended June 30, 2024.
*
Defined as Adjusted EBITDA divided by Sales. This metric is subject to change as the Company works to finalize the separation in the same manner as the metrics from which this metric is derived, as noted above.
(xi)
Represents management's preliminary estimate of the potential impact on Adjusted EBITDA of Canada Packers and Maple Leaf Foods (as defined in note (i) above), respectively, if the separation had occurred on June 30, 2024. Primarily relates to management's preliminary estimate of (1) a change in Adjusted EBITDA of Canada Packers and an offsetting change in Adjusted EBITDA of Maple Leaf Foods as a result of the anticipated impact of the supply agreement and other contractual arrangements expected to be entered into in connection with the separation, (2) public company costs that would have been incurred by Canada Packers, and (3) a reallocation of certain SG&A expenses between Canada Packers and Maple Leaf Foods. As noted above, this estimate is subject to change as the Company works to finalize the separation.
(xii)
Defined as Adjusted EBITDA plus management's preliminary estimate of the potential impact of the separation described in, and subject to the qualifications described in, note (xi) above.
(xiii)
Defined as Pro Forma Adjusted EBITDA, as described in note (xii) above divided by Pro Forma Sales. This metric is subject to change as the Company works to finalize the separation in the same manner as the metrics from which this metric is derived, as noted above.
(xiv)
Presented for illustrative purposes only, based on management estimates and assumptions, to indicate what the potential impact on Pro Forma Adjusted EBITDA may have been if market conditions during the period presented had reflected normal market conditions, defined as the 5-year pre-pandemic (2015 – 2019) average ("Normal Market Conditions"). Actual market conditions during the period presented were materially different from Normal Market Conditions, and there can be no assurance that actual Pro Forma Adjusted EBITDA would have been impacted in the manner shown if Normal Market Conditions had existed during the period presented, or that actual future market conditions will reflect Normal Market Conditions. This metric is not intended to be indicative of potential financial results for any future period.
(xv)
Defined as Pro Forma Adjusted EBITDA, as described in note (xi) above, plus management's preliminary estimate of the potential impact if market conditions during the period presented had reflected Normal Market Conditions, subject to the qualifications described in note (xiv) above. This metric is presented for illustrative purposes only and is not intended to be indicative of potential financial results for any future period.
(xvi)
Defined as Pro Forma normalized Adjusted EBITDA, as described in note (xiv) above, divided by Pro Forma Sales.This metric is presented for illustrative purposes only and is based on management estimates and assumptions. This metric is subject to change and is expected to be refined prior to the separation in the same manner as the metrics from which this metric is derived, as noted above. Actual market conditions during the period presented were materially different from Normal Market Conditions, and there can be no assurance that actual Pro Forma Adjusted EBITDA Margin would have been impacted in the manner shown if Normal Market Conditions had existed during the period presented, or that actual future market conditions will reflect Normal Market Conditions. This metric is not intended to be indicative of potential financial results for any future period.
Adjusted EBITDA, Pro Forma Adjusted EBITDA, and Pro Forma normalized Adjusted EBITDA, and related margins, as presented in the tables above, are non-IFRS metrics and do not have a standardized meaning prescribed by IFRS. Consequently, they may not be comparable to similarly titled measures presented by other publicly traded companies and should not be construed as an alternative to other financial measures determined in accordance with IFRS.
About Maple Leaf Foods Inc.
Maple Leaf Foods is a leading protein company responsibly producing food products under leading brands including Maple Leaf ®, Maple Leaf Prime ®, Maple Leaf Natural Selections ®, Schneiders ®, Mina ®, Greenfield Natural Meat Co. ®, Lightlife ® and Field Roast™. The Company's portfolio includes prepared meats, ready-to-cook and ready-to-serve meals, snack kits, value-added fresh pork and poultry, and plant protein products. The Company employs approximately 13,500 people and does business primarily in Canada, the U.S. and Asia. The Company is headquartered in Mississauga, Ontario and its shares trade on the Toronto Stock Exchange (MFI).
Consolidated Interim Balance Sheets
(In thousands of Canadian dollars)
(Unaudited)
As at June 30,
2025
As at June 30,
2024
As at December 31,
2024
ASSETS
Cash and cash equivalents
$ 236,045
$ 158,381
$ 175,908
Accounts receivable
175,559
184,300
170,919
Notes receivable
45,510
44,886
37,978
Inventories
602,370
580,472
553,398
Biological assets
175,550
124,688
169,399
Income and other taxes recoverable
2,474
62,761
7,551
Prepaid expenses and other assets
39,155
35,203
42,342
Assets held for sale
—
27,438
22,769
Total current assets
$ 1,276,663
$ 1,218,129
$ 1,180,264
Property and equipment
2,058,069
2,186,520
2,123,167
Right-of-use assets
149,272
171,692
160,922
Investments
12,500
16,112
12,763
Investment property
63,488
34,744
42,588
Employee benefits
15,500
116,800
22,429
Other long-term assets
23,624
22,271
24,918
Deferred tax asset
45,808
42,504
46,588
Goodwill
477,353
477,353
477,353
Intangible assets
325,055
343,457
339,526
Total long-term assets
$ 3,170,669
$ 3,411,453
$ 3,250,254
Total assets
$ 4,447,332
$ 4,629,582
$ 4,430,518
LIABILITIES AND EQUITY
Accounts payable and accruals
$ 628,257
$ 543,792
$ 561,179
Current portion of provisions
9,182
9,673
14,482
Current portion of long-term debt
351,673
300,371
301,478
Current portion of lease obligations
39,710
40,544
39,900
Income taxes payable
51,955
2,351
2,595
Other current liabilities
29,342
24,986
37,587
Total current liabilities
$ 1,110,119
$ 921,717
$ 957,221
Long-term debt
1,228,599
1,581,093
1,390,479
Lease obligations
136,631
157,550
147,892
Employee benefits
61,837
60,796
62,395
Provisions
3,122
1,998
3,912
Other long-term liabilities
4,961
1,167
5,205
Deferred tax liability
313,939
330,232
325,137
Total long-term liabilities
$ 1,749,089
$ 2,132,836
$ 1,935,020
Total liabilities
$ 2,859,208
$ 3,054,553
$ 2,892,241
Shareholders' equity
Share capital
$ 904,226
$ 886,876
$ 897,839
Retained earnings
631,839
640,589
587,393
Contributed surplus
14,049
6,773
12,482
Accumulated other comprehensive income
38,642
44,222
43,994
Treasury shares
(632)
(3,431)
(3,431)
Total shareholders' equity
$ 1,588,124
$ 1,575,029
$ 1,538,277
Total liabilities and equity
$ 4,447,332
$ 4,629,582
$ 4,430,518
Consolidated Interim Statements of Earnings (Loss)
(In thousands of Canadian dollars, except share amounts)
(Unaudited)
Three months ended June 30,
Six months ended June 30,
2025
2024 (i)
2025
2024 (i)
Sales
$ 1,362,144
$ 1,255,173
$ 2,603,437
$ 2,402,464
Cost of goods sold
1,126,427
1,124,018
2,149,946
2,044,969
Gross profit
$ 235,717
$ 131,155
$ 453,491
$ 357,495
Selling, general and administrative expenses
112,966
116,649
227,773
226,682
Earnings before the following:
$ 122,751
$ 14,506
$ 225,718
$ 130,813
Restructuring and other related costs
2,705
6,893
4,208
6,168
Other expense (income)
12,789
(3,492)
14,022
(2,335)
Earnings before interest and income taxes
$ 107,257
$ 11,105
$ 207,488
$ 126,980
Interest expense and other financing costs
26,234
43,637
55,880
85,720
Earnings (loss) before income taxes
$ 81,023
$ (32,532)
$ 151,608
$ 41,260
Income tax expense (recovery)
23,245
(6,359)
44,267
15,882
Earnings (loss)
$ 57,778
$ (26,173)
$ 107,341
$ 25,378
Earnings (loss) per share attributable to common
shareholders:
Basic earnings (loss) per share
$ 0.47
$ (0.21)
$ 0.87
$ 0.21
Diluted earnings (loss) per share
$ 0.46
$ (0.21)
$ 0.86
$ 0.20
Weighted average number of shares (millions):
Basic
123.9
122.9
123.8
122.7
Diluted
125.6
122.9
125.3
123.8
(i)
Quarterly amounts for 2024 have been adjusted. See Note 16 in the condensed consolidated interim financial statements as filed on SEDAR+ at www.sedarplus.ca.
Consolidated Interim Statements of Other Comprehensive Income
Accumulated other comprehensive income (loss)
(In thousands of Canadian dollars)
(Unaudited)
Share
capital
Retained
earnings
Contributed
surplus
Foreign
currency
translation
adjustment (i)
Unrealized
gains and
losses on
cash flow
hedges (i)
Unrealized
gains on fair
value of
investments (i)
Revaluation
surplus
Treasury
shares
Total
equity
Balance at December 31, 2024
$ 897,839
587,393
12,482
14,545
(1,257)
(6,641)
37,347
(3,431)
$ 1,538,277
Earnings
—
107,341
—
—
—
—
—
—
107,341
Other comprehensive income (loss) (ii)
—
(3,319)
—
(5,022)
(330)
—
—
—
(8,671)
Dividends declared ($0.48 per share)
5,695
(59,576)
—
—
—
—
—
—
(53,881)
Share-based compensation expense
—
—
12,406
—
—
—
—
—
12,406
Deferred taxes on share-based compensation
—
—
3,175
—
—
—
—
—
3,175
Exercise of stock options
692
—
—
—
—
—
—
—
692
Shares purchased by RSU trust
—
—
—
—
—
—
—
(4,094)
(4,094)
Settlement of share-based compensation
—
—
(14,014)
—
—
—
—
6,893
(7,121)
Balance at June 30, 2025
$ 904,226
631,839
14,049
9,523
(1,587)
(6,641)
37,347
(632)
$ 1,588,124
Accumulated other comprehensive income (loss) (i)
(In thousands of Canadian dollars)
(Unaudited)
Share
capital
Retained
earnings
Contributed
surplus
Foreign
currency
translation
adjustment (i)
Unrealized
gains and
losses on
cash flow
hedges (i)
Unrealized
gains on fair
value of
investments (i)
Revaluation
surplus
Treasury
shares
Total
equity
Balance at December 31, 2023
$ 873,477
597,429
3,227
8,625
4,416
(2,559)
37,347
(7,183)
$ 1,514,779
Earnings
—
25,378
—
—
—
—
—
—
25,378
Other comprehensive income (loss) (ii)
—
71,951
—
1,273
(4,880)
—
—
—
68,344
Dividends declared ($0.44 per share)
10,901
(54,169)
—
—
—
—
—
—
(43,268)
Share-based compensation expense
—
—
11,387
—
—
—
—
—
11,387
Deferred taxes on share-based compensation
—
—
(425)
—
—
—
—
—
(425)
Exercise of stock options
2,498
—
—
—
—
—
—
—
2,498
Settlement of share-based compensation
—
—
(7,416)
—
—
—
—
3,752
(3,664)
Balance at June 30, 2024
$ 886,876
640,589
6,773
9,898
(464)
(2,559)
37,347
(3,431)
$ 1,575,029
(i)
Items that are or may be subsequently reclassified to profit or loss.
(ii)
Included in other comprehensive income (loss) is the change in actuarial gains and losses that will not be reclassified to profit or loss and has been reclassified to retained earnings.
Consolidated Interim Statements of Cash Flows
(In thousands of Canadian dollars)
(Unaudited)
Three months ended June 30,
Six months ended June 30,
2025
2024
2025
2024
CASH PROVIDED BY (USED IN):
Operating activities
Earnings (loss)
$ 57,778
$ (26,173)
$ 107,341
$ 25,378
Add (deduct) items not affecting cash:
Change in fair value of biological assets
8,087
52,488
(8,324)
(16,655)
Depreciation and amortization
62,103
64,446
125,757
130,299
Share-based compensation
6,629
6,089
12,406
11,387
Deferred income tax (recovery) expense
(8,237)
(8,843)
(11,954)
11,093
Current income tax expense
31,482
2,484
56,221
4,789
Interest expense and other financing costs
26,234
43,637
55,880
85,720
Gain on sale of long-term assets
—
(1,326)
(10,609)
(1,637)
Impairment of property and equipment and right-of-use assets
1,291
118
2,157
118
Change in fair value of long-term assets
—
(5,038)
—
(5,038)
Change in fair value of non-designated derivatives
(744)
2,991
378
(1,674)
Change in net pension obligation
1,233
2,169
1,952
3,236
Net income taxes (paid) refunded
(229)
18,764
(1,594)
21,746
Interest paid, net of capitalized interest
(26,127)
(32,459)
(54,700)
(72,936)
Change in provision for restructuring and other
related costs
(1,788)
3,087
(6,051)
(173)
Change in derivatives margin
3,650
(1,075)
2,039
1,241
Cash settlement of derivatives
—
(728)
—
(2,878)
Other
(23,549)
2,231
(18,404)
5,324
Change in non-cash operating working capital
101,774
(77,366)
(3,025)
(66,519)
Cash provided by operating activities
$ 239,587
$ 45,496
$ 249,470
$ 132,821
Investing activities
Additions to long-term assets
$ (24,433)
$ (16,318)
$ (49,285)
$ (40,131)
Interest paid and capitalized
(303)
(219)
(583)
(574)
Proceeds from sale of long-term assets
1,750
2,631
14,754
3,496
Cash used in investing activities
$ (22,986)
$ (13,906)
$ (35,114)
$ (37,209)
Financing activities
Dividends paid
$ (27,150)
$ (21,607)
$ (53,881)
$ (43,268)
Net decrease in long-term debt
(60,265)
(50,480)
(80,047)
(81,365)
Payment of lease obligation
(8,091)
(7,891)
(16,183)
(16,337)
Exercise of stock options
534
2,498
534
2,498
Purchase of treasury shares
(4,094)
—
(4,094)
—
Payment of financing fees
(541)
(2,122)
(548)
(2,122)
Cash used in financing activities
$ (99,607)
$ (79,602)
$ (154,219)
$ (140,594)
Increase (decrease) in cash and cash equivalents
$ 116,994
$ (48,012)
$ 60,137
$ (44,982)
Cash and cash equivalents, beginning of period
119,051
206,393
175,908
203,363
Cash and cash equivalents, end of period
$ 236,045
$ 158,381
$ 236,045
$ 158,381
SOURCE Maple Leaf Foods Inc.